Off-plan transactions have grabbed the headlines in Dubai once more as the city prepares to meet the demands for the World Expo 2020. According to data from Chestertons Mena has shown that off-plan transactions in Dubai increased 60 per cent year-on-year in 2016-2017, with the highest sales volumes achieved in Meydan, Mohammad Bin Rashid City, Dubailand, Business Bay and Al Furjan and the highest values achieved in the Lagoons, Downtown Dubai and Business Bay. Similar trends are evident in Abu Dhabi.
With developers now offering everything from interest-free periods to luxury cars, it’s easy to be carried away in the excitement of owning a beautiful property. There are many benefits to buying off-plan – from high capital appreciation to exclusive locations and breathtaking design. However, here are two questions every off-plan investor should ask before signing on the dotted line:
Who is the developer?
Dubai’s major developers are well-known, reputably firms, with many successful projects in the portfolio. While this does not guarantee their future success, delivery rates are a proven indicator of a safe investment in most cases. Agents provide impartial advice, often drawing on years of first-hand experience of the market and it’s important to tap into them as a source of insider knowledge; not only on the developer, but on the reputation of contractors and any known issues with infrastructure in the surrounding neighbourhood.
Is the development approved by Rera?
In October 2016, new regulations came into force requiring all developers and brokers to obtain approval from Dubai’s Real Estate Regulatory Authority (Rera) before advertising property in the media. This offers additional transparency for investors and genuine developers and has renewed confidence in the off-plan market. To streamline the process for potential investors, the Rera website now has a tool to check the number, escrow account, status, and progress of real estate projects.
Joseph Ghossoub is the chairman of G&Co Real Estate The views expressed here are his own.
